External Trade
The main destination of Kenya’s export on regional basis is Africa followed by the European Union. In 2000, the share of total exports to African countries and the European Union stood at 46% and 30% respectively. Within the African region, exports to COMESA countries accounted for 42% of the total value of exports in 2000.
TOTAL EXPORTS FROM 1996 TO 2000 (US$ MILLION)
Region 1996 1997 1998 1999 2000
Europe 522.2 527.8 482.4 509.5 535.9
America 50.3 62.6 48.4 42 46
Africa 735.3 720.5 738.8 734.9 794
Asia 198.8 205.3 256.9 266.1 285.1
Australasia & Oceanic 23.9 28 21.1 10.2 55.7
The major source of Kenya’s imports is Asia accounting for 49.5% followed by Europe 34.0% while imports from Africa account for 9.2% of total imports.
COMESA
COMESA region is the leading destination of Kenya’s exports. This may be attributed to the signing of the Free Trade Area in the COMESA region, in October 2000. Over the last four years, exports to COMESA have increased from KShs. 51.4 billion in 1997 to KShs. 56.7 billion in 2000, representing an increment of 10.3%. The organisation has also facilitated the establishment of the African Trade Insurance Agency (ATIA) to insure investments against potential risk.
East African Community (EAC)
Since the transformation of East African Co-operation into a Community in 1999, Kenya’s exports to the region has grown from 8% of the country’s total exports in 1990 to 24% in 2000. The expected transformation of the East African Community into the East African Customs Union by 2004 will facilitate increased trade between member countries. This will be attained once elimination of internal tariffs and establishment of common external tariff, allowing for possible conclusion of the customs union protocol is accomplished.
African Caribbean Pacific – European Union (ACP-EU)
The European Union market is an important destination for Kenya’s export which accounts for 30% of the country’s total exports. With the end of LOME IV Convention and emergence of Cotonou Agreement, Kenya has initiated measures to establish alternative trading arrangement with European Union.
African Growth and Opportunity Act (AGOA)
Kenya is already a beneficiary of African Growth and Opportunity Act of the United States of America. Under this Act, the high duties and restrictive quota that had been imposed on exports of textiles have been lifted.
Values of Principle Exports and Imports
Tea, horticulture and Coffee continue to be the leading export earners for Kenya jointly accounting for 52.7% for total export earnings in 2002 compared with 50.9% in 2001. Earnings from horticulture, which declined by 6.5% in 2001, expanded by 42.8% in 2002. Value of fish and cement exported edged up 9% and 12% respectively. Other notable increases in export earnings were in tobacco products, articles of plastics, sugar confectionery and animal and vegetable oils.
Export value of crude petroleum and refined petroleum products dropped by 23.3% and 15.2% respectively. Import bill for iron and steel and industrial machinery decreased by 7.1% and 32.8% respectively. However, import values for animal/vegetable oils rose by 41.6%. Other increases in import value were recorded in medicinal and pharmaceutical products essential oils and perfumes, hand and machine tools and agricultural machinery and tractors.